On the Move: What newcomers need to know about closing on their new home

On the Move: What newcomers need to know about closing on their new home

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There are many aspects to the real estate transaction that are handled much differently in Texas than in other parts of the country. The closing, which is perhaps the most exciting part for a home buyer, can often be a little daunting for newcomers who are somewhat unfamiliar with Texas real estate laws and practices.

The closing is the final step in a real estate transaction, as it signifies the legal transfer of ownership of a property from the seller to the buyer. It’s basically the ceremonial exchange of money and signatures for ownership and keys.

In Texas, most closings are handled by title companies, which act as both the escrow agent and the title insurer. They hold the earnest money, prepare the closing statement, and they communicate and coordinate with all of the parties involved in the transaction.

“There are so many factors, moving parts and people involved in a real estate transaction, and the title company is really the nucleus of the transaction,” said Gayle Brand, president of Chicago Title Houston. “We deal with the seller, the buyer, the listing agent, the selling agent, the lender, the surveyor, the homeowners insurance company, and the home warranty company. So, it takes everybody doing their part to keep it moving.”

Generally speaking, Brand said that it takes 45 days to close on a property, although there are exceptions that could either speed up or delay the process.

“If there is financing involved, there’s a lot more to it, and more things that need to be done on the lender’s side with underwriting, all of the paperwork that has to be completed, the approvals and appraisals, and other things related to the regulations that are built into the process for consumer protection,” said Brand.

The best way to avoid delay is for everyone involved to make sure they are staying on top of their part of the transaction, and to provide information as soon as possible when requested.

“The buyer will be asked for a lot of information from their lender, the title company, and their Realtor, so communication is really the key to keep everything moving,” Brand said. “It literally takes a village to get a deal closed, so everybody has to do their part, including the buyers and sellers.”

If a home buyer is paying cash for a property, the closing process can happen much faster. In fact, Brand said that it is even possible to close in a day or two.

On the other hand, delays in the closing process can occur for a variety of reasons. This could include the sale of a property due to death or divorce, or other title issues that might need to be cleared up before closing.

In terms of advice for home buyers, Brand said that the single most important thing that they need to be aware of today is wire fraud. Unfortunately, wire fraud is a rampant issue in the real estate industry today, making it far too easy for unsuspecting people to be victimized.

“It’s scary out there for new and experienced buyers who are falling victim to wire fraud. It happens every single day. The bad guys have caught onto our lingo and they are watching the transactions, and impersonating the people involved. So, they email the buyers instructing them where to wire their money, and people are doing it,” Brand said. “This is a big deal and a big challenge in our industry. There’s nothing worse than seeing a buyer lose their life savings to bad guys, and sometimes they get their money back and sometimes they don’t.”

To combat this risk, title companies and real estate professionals continue to inform home buyers of the frequency at which this occurs, and to urge them to always exercise extreme caution when replying to emails related to their transaction.

“There is so much communication, and so much going through email, which can get compromised. So, our industry has had to create secure portals for communication,” Brand said.

And, relocation is stressful enough, without the added worry associated with wire fraud. For that reason, Brand said that the trust between the home buyer and their Realtor and title company is more important than ever before.

“Who you choose for your Realtor and your title company can be the difference of whether you’re going to have a pleasant, smooth experience or not. So, always get a referral for your Realtor and title company. You need to work with people you trust, who are going to do everything in their power to reduce your anxiety and make it a smooth process,” she said.

Michelle Sandlin is an award-winning writer, journalist and global mobility industry expert. Follow her on Facebook: www.facebook.com/TheMichelleSandlin and on Twitter: @MichelleSandlin. Also visit “On the Move” at blog.chron.com/onthemove.